Weekly Market Update: Is the bull at the gates?

A rollercoaster of a week in crypto, influenced by major geopolitical events, saw a Bitcoin price swing of nearly $10,000 to break to a new all time high in both NZD and AUD today (but not USD yet). Key momentum indicators are heading up and media interest is back.

Bitcoin continues to dominate the market, but there are growing signs that an Alt Season may be just around the corner as Solana, Doge and other hot Meme Coins join in on the action.

All eyes are on the lead up to the US election next week with crypto playing a key role in the campaign promises. Elon Musk has also added fuel to the hopium and bullish sentiment.

In macro news, energy took a tumble as Middle East tensions eased for the time being. The BRICS Summit ended without officially declaring a ‘new world order’, but grew in strength.

The US continues to show signs of a struggling consumer but holds hopes for a ‘soft landing’ whilst the picture isn’t quite as rosy across in Europe.

Closer to home, it’s still all about housing as rental prices in AU and capital gains tax for NZ property investors is in discussion again.

Market sentiment has held up nicely for a second week and we remain firmly in greed territory.

Highlights this week: 

• A rollercoaster of a week for crypto as we’ve seen a swing of nearly $10,000 in the Bitcoin price. It started with a flash crash to retest the $65,000 ‘bull flag breakout zone’ followed by a rapid run through the key $70,000 resistance level to come within 1% of a new all time high USD.
• Bitcoin did break to a new all time high in both AUD and NZD today.
• At the time of writing BTC is up 7.2% for the week.
• Bitcoin is still leading the pack with market dominance creeping over 60%. When will Alts get a turn?
• Market momentum indicators are rising across the board with weekly RSI over 60 and consistent positive inflows into the Bitcoin ETFs.
• Tether has hit a record $120 billion market cap this week.
• We saw a mini Meme Coin rally led by DOGE up 23.8%.

View all top gainers: Visit the top gainers page to find out more. 

Highlights from the crypto space

Rumours of a Tether investigation by US Federal Authorities rocked the crypto markets last week and sent Bitcoin plummeting. The Tether CEO has since denied claims saying that he has seen “no indication of such a probe”.

SEC Chair Gary Gensler could be nearing the end of his controversial SEC reign. His term expires in 2026 but he could likely depart in the coming months following the 2024 presidential election. It couldn’t happen soon enough, as he earmarks crypto on the SEC priority list for further examination in 2025.

Elon Musk is at it again with his ‘cryptic crypto tweets’ pumping the Doge to his over 200 million followers on X. He also called for a “financial emergency” as US debt reached $35.7 trillion priming Bitcoin for a rally that could rival Gold. 

Taking a page out of Michael Saylor’s playbook, Microsoft shareholders will vote in December on whether the company should invest in Bitcoin. Microsoft management are not convinced and are urging shareholders to say ‘no’.

MicroStrategy is up over 1,500% in the last 25 years compared to Microsoft’s 1,460% gains over the same period. Proving that MicroStrategy’s Bitcoin bet has so far paid off in a spectacular fashion.

Polymarket has reached a record 66.5% in favour of Trump winning the US Presidential Election next week with over $2.3 billion inflows.

Trump has made some big campaign promises including turning the US into the “crypto capital of the world”.

According to one popular trader on X Alt Season could be just around the corner. That is once Bitcoin gives confidence of a clear breakout and the green light to the Alt Coins to join the party. It has been a Bitcoin dominated run so far, but this could be about to change.

Global Payments provider Stripe has moved to acquire Bridge in what many are calling a clear evidence of their deeper commitment to stablecoin technology.

Stripe can reduce transaction costs, enhance speed, and expand its payment offerings, potentially challenging banks’ dominance in large-scale transactions.

Other notable highlights from the crypto space:

• Chainlink announced private transactions (CCIP) in a potential game changer for financial institutions.
• VanEck predicts Bitcoin will be used in global trade and become a reserve asset worth $3 million by 2050 with central banks making a 2% allocation.
• Blackrock now holds over 400,000 Bitcoin as a potential showdown with Satoshi looms.
• Popular DeFi protocol Uniswap is moving to its own blockchain, called Unichain.
• Solana meme coin Sharpei plunged 96% in seconds after an epic rug pull.

🌎 Macro news TLDR: …Soft landing still in question.

The markets breathed a sigh of relief as Israel’s retaliatory strike against Iran was limited to military instalments and did not appear to be aimed at oil and nuclear targets after calls from allies for restraint.  

Oil took a nosedive as a result dropping to below $68 USD per barrel (at time of writing) on continued fears that a Trump presidential win could result in increased US production.

North Korea is joining the fight in Ukraine as rumours of up to 10,000 troops are to be deployed.

The BRICS Summit in Kazan fell short of speculations calling for a ‘new global order’ – 13 new partner countries were officially added and a new cross border payments system was unveiled. It is too early to call an end to US dollar hegemony, but this is one to keep an eye on.

U.S. economic news

US home sales plunged to a 15 year low but prices remain elevated as consumers struggle with rising 30 year mortgage rates.

Treasury yields rose again across the board as concerns about the national debt continue to grow. The market is pricing in a 90% chance of a 25 bps cut in the Fed post election meeting next week, which should stabilise the bond market.

The number of US job openings hit the lowest level in 4 years as the market turned its attention to the US election next Tuesday.

After the ‘Trump serving fries’ publicity stunt that gained wide social media attention last week, McDonalds was hit with an E. coli outbreak resulting in one death and multi-state hospitalisations. 

Over in Europe….

In a historic move, Volkswagen plans to close 3 plants in Germany and layoff thousands of workers as the rising costs of energy and labour bite.

Germany could be the ‘canary in the coal mine’ as the IMF warned in its latest economic outlook that Europe’s economy is poised to fall further behind the US due to a lack of productivity and ‘business dynamism’. 

And in Asia…

In an election shock, the longtime ruling party in Japan lost its majority in the lower house for the first time since 2009 and will need to work with other parties to form a government. The Bank of Japan will meet later this week, but is expected to hold off on further rate hikes.

Tokyo Metro shares soared a whopping 45% on their debut after Japan’s largest IPO in six years.

Some foreign investors are more upbeat about China as they ready for another Y10 trillion in stimulus – whereas others are scaling back activity and cutting costs as there is seemingly no end in sight for the housing market crash. It’s yet to be seen if Beijing will be able to turn things around.

Closer to home…

After a 7% YOY rise in national median rent prices, the Australian rental market has finally slowed for the first time in 3 years – but it may not be enough to save the many who are in financial stress.

Treasurer Jim Chalmers said “billions of dollars” were wasted in poorly targeted relief payments during the Covid-19 pandemic.

Opposition leader, Peter Dutton, has called for a corruption probe over Qantas flight upgrades, as PM Albanese lands himself in hot water again.  

A new poll finds that the majority of NZers are in support of a capital gains tax on investment property but not on other assets. Will the current government be brave enough to open this ‘can of worms’ again?

Major banks are pushing short term interest rates lower again in anticipation of further OCR rate cuts when the RBNZ meets at the end of November.

The NZD has been trading in a tight range between 0.58 and 0.64 to USD for the past 2 years – all eyes on the US election result next week to determine the future path.

And that is all for this week – stay tuned for the next update.

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